Brazil will be presenting a new bill to make an investment of $15 billion in crypto investments. The Brazilian Federal Government will start to debate the bill in favor of this crypto investment on August 20.
Brazil may soon add Bitcoin to its national treasury. A new bill proposes investing as much as $15 billion (5% of country’s reserves) in Bitcoin to protect against global volatility. The biggest names in the government, banking and crypto world are set to gather for a hearing on August 20.
Brazil’s Strategy to Hedge Against Global Instability
Brazil’s latest strategy to defend itself against global instability is to invest in Bitcoin.
On August 20, 2023, Brazil’s House of Representatives is set to hold a hearing that could change the financial strategies of all of Latin America. They have the date earmarked to decide whether Brazil should use as much as 5% of its reserves for Bitcoin, or around $15 billion.
Bitcoin as a Strategic National Asset
This ambitious plan, made public in November 2024, has caused quite a stir. The proposal seeks to classify Bitcoin as a strategic asset to hedge against currency fluctuations and geopolitical crises, and facilitate the use of the blockchain in both the public and private sectors.
Major Institutions Set to Participate in Debate
As per the website of Brazil’s House, six leading institutions will be taking part in the hearing – these are:
- Central Bank of Brazil
- Ministry of Finance (Brazil)
- Crypto advocacy groups
- Fintech and banking representatives
If the legislation moves out of the lower house, it will go through to the Senate and from there to President Luiz Inácio Lula da Silva’s desk for approval or veto.
Praise and Skepticism Around the Proposal
The initiative has drawn both praise and skepticism.
Debating whether to make a sovereign Bitcoin reserve would be in the public interest and important for the well-being of Brazil, said Pedro Giocondo Guerra, chief of staff to Vice President Geraldo Alckmin.
Bitcoin is the gold of the internet — Friedman (2016)
But not everyone is convinced. Central Bank’s Director of Monetary Policy, Nilton David, has warned against the incorporation of crypto into Brazil’s foreign exchange reserves due to volatility and regulatory problems.
Global Trend: Brazil Follows Trump’s Lead on Bitcoin Reserves
This isn’t an isolated trend. Earlier this year, former U.S. President Donald Trump made an executive order for establishing a national reserve of Bitcoin, causing the world to follow suit.
- Kazakhstan has announced plans to create its own reserve, perhaps with seized coins.
- India and Sweden may adopt similar strategies, sources claim.
Bitcoin Adoption by Nations on the Rise
Nations currently holding the highest Bitcoin reserves include:
A Turning Point for Crypto in Developing Nations
Brazil’s choice may signal a major turning point for crypto acceptance in developing nations. Furthermore, it could activate a new digital gold rush among nations.
If legislation is approved, Brazil won’t just be purchasing Bitcoin; it will be investing in the future of money.
